♪ cory johnson: from pier 3 in san francisco, welcome to "bloomberg west," where with we focus on technology and the future of business. i am cory johnson. we are bringing you the best of west. to our top story -- one of the biggest events in spain. among those in attendance, f.c.c.'s tom wheeler who flew to barcelona just days after the landmark decision to subject the internet to more regulation. "bloomberg businessweek's" brad stone caught up with the

chairman. chair tom wheeler: it was interesting, how interested everybody is to learn exactly what the rules are about and how we structured them in such a way that they are built on the mobile model. we built them around what has worked for the last 22 years in terms of regulating the wireless industry in the united states. so that we could make sure that there was adequate investment that would continue to come as a result of the fact that there is no rate regulation, no tariffing, and those traditional kinds of monopoly regulation that you have heard so much about during the debate. so the feeling that i am getting here is they are saying, as i understand it better, and it is significant. sprint has come out and say they support it. t-mobile has said they will continue investing under this. google fiber has said even though we are now a title ii common carrier, we will continue to investigate the small wireless carriers, have said this is something we can live

with. on and on and on. there has been a list of people who have said, well, the more we guest past the rhetoric and the more we get toward really what is going on here, then perhaps this is something we can take. brad stone: that said, though, will the road ahead be that easy? should we expect litigation similar to what we saw in 2010? chair wheeler: the big dogs have promised that they are going to litigate. one of the funny things, brad, about it is everybody talks about the 317-page order. the rules actually take up 8 pages. and the other 309 pages are the explanations, which in many

cases is talking to the court because we know that the big dogs are going to take this to court. brad: i am interested in your personal journey to net neutrality. you were a lobbyist for many years. what was the epiphany for you at the fcc that brought about the ruling? chair wheeler: it was longer than that. i have been a proponent of open networks before the words in the neutrality was invented because everybody talks to me. "oh, wheeler, former lobbyist." what they also leave out is

former entrepreneur who started half a dozen companies, former venture capitalist who understood the importance of open internet, and access to networks. and so i walked into this job being a strong proponent of open networks. brad: did the very public statement by the obama administration last year play a role in the new rules? chair wheeler: we had been going through a whole process. i had proposed in february of -- a set of rules that took a slightly different approach using what is called section 706, but also asked the question about, should we use title ii? and between that period in february and -- or may to the middle of summer, i met with a whole bunch of consumers and innovators and investors who all said there is a real problem in the approach you are looking at. cory: brad stone with f.c.c. chairman tom wheeler. he also spoke with at&t's glenn lurie about net neutrality. glenn: our vision is about everything that is connected. the industrial internet of things. businesses wanting to be better, more productive. here you have got the car business which to us is one of the greatest opportunities. we see the car as the next great device in our lives. and we announced in third quarter we are going to connect 50% of the cars in the united states this year. so here at the show we have got a few of our partners with us. what it is is putting lt in the vehicle, utilizing that to make the car a safer, better, more

productive place. it is about getting v-v, vehicle to vehicle, so they can talk to each other, vehicle to infrastructure to make cities better. i can go on and on. brad: why is at&t's network better suited for this market? glenn: we have a phenomenal network. but this is more about the platforms you build around i.o.t. and what is important is we started on this journey a long time ago. we were early, we invested early, we actually built platforms that allow us to be better partners than anybody else in the world. and i am really excited about where we are. i am excited about the partnerships we have. and yes we are leading significantly. brad: so f.c.c. chairman tom wheeler is here with us today in barcelona. of course last week the f.c.c. new network neutrality rules that also might govern wireless. what do you say to tom today if you see him, and how do you guys react to those rules? glenn: it is tough to react to them at this point.

we have not seen the order yet. we know what is come out. the order is supposed to come out in the next couple of weeks and i think we will react to that once we see it. at&t has said clearly what our position is, and we are pro-net neutrality. the question is how and how you govern that. so we will see what happens. we will see what the order looks like. but at this point, we are optimistic that we can make it work. brad: ok. google is one of your big partners. i was talking yesterday to a google executive, sundar pichai, who talked about perhaps introducing a google wireless network, a google branded net work. would that be competition for at&t? glenn: sure. obviously it depends on what he is going to do.

i don't know all the details about what google and sundar are going to do. i think the key here is that customers deserve choice. so if they come in and google wants to come in, that is great. obviously we are a partner with them. but one of the things we have in our world of wireless is a lot of frenemies. a lot of partners we also compete with. and that is perfectly fine. but we will see what they are working on and talk to them and we will see where that goes. brad: i am hearing the term 5g more at this year's event. frankly, i was just getting used to 4g. what does 5g bring to customers? glenn: first of all, 4g is great. lg is phenomenal.

but what you are hearing is that 5g is coming. one of the things that we are hearing a lot is a real concern around we have got to do more for internet of things. right? we are talking about cars, connected home, everything. and what we know 5g will bring is faster speeds and all that, we also believe it is going to be a network that also has a layer built for i.o.t., which for us means lower power, longer battery life, and those types of things. so i am actually very excited about it. 4g is here for a while. 5g is further out. i think we have got all the capabilities that we need but it is deciding to start to see what is coming next. cory: that was the very excited at&t mobility ceo glenn lurie with bloomberg's brad stone. we will be back with some of the gadgets at the mobile world congress. ♪

cory: this is the best of "bloomberg west." blackberry, samsung, just a few of the companies showing off new cell phones. this comes at crucial times for each of these companies. samsung, trying to keep a foothold in asia as iphones are skyrocketing in china. htc hoping to rebound after three years of slowing sales. are new gadgets enough? i put that question to crawford del prete. crawford del prete: at the end of the day it is about iconic. and that is really where everyone is headed do of i have the iconic product that is going to oot tract that next generation user or attract someone off one platform to another platform. that is clearly what they are trying to do here. cory: so let's get to specifics of the specifics. are consumers anywhere picking phones based on the quality of the picture or is that something that the salesperson does in the store or happens with an online review?

crawford: by and large it is socialized. by and large you are at a bar and someone takes a photo and someone says that is a nice photo. when you do a survey, you find that in the top five features people are looking for you do see image or quality of screen in those kinds of features. but to your point, it is not like it was in pc's where people would study. it is a much more social technology. cory, that is a great picture, hmm, what kind of phone was that? that is how it tends to get socialized and people tend to learn about features. cory: so samsung talking about an edge phone that is got an image on the side. this is the third time they have

announced this device. crawford: at least the second. cory: they announced it at ces at a press conference last summer in new york. they are announcing it today. at some point could we say it is announced? crawford: it is here. cory: but does that matter? it looks different. is that the kind of thing that could actually drive sales to your point that is a social thing that people see out? crawford: i think that it is the start of a trend. we actually believe that by 2020 a fairly significant percent of smart phones will be using multiple surfaces. there is a product that is the second generation that uses a display on the front and on the back a kindle display. so they are using multiple sides for notifications and for reading. we think that the edge and the back are blank space and they are space that can be used. so while people may think that the edge is a little bit silly or a little bit kitschy today, i actually think it is the start of a trend, and i think you will see people experimenting.

cory: interesting. so that suggests to me that the way that people buy phones is changing. in this country, the way people will buy phones is they will make a decision about platform android or iphone, and then go to a store to make the choice. is that the way it happens in the rest of the world? crawford: it is. in many ways it is a little bit less about the individual platform, but that certainly plays in in terms of the number of apps you can get access to. but it also plays into another important feature which is cost. in my role, we do business in 60 countries. there is a reason why android has such a huge market share around the world. and that is that they are able to reach these low end points. cory: because they are giving away the software. crawford: that is why you see google soft moving in that direction. cory: so trying to find a way in there, blackberry ceo john chen. here's what he had to say at the world congress. john chen: i want to make sure

that everything is agnostic. if you look at blackberry, it is nitched. it is limited. i want to be able to serve in a higher spectrum. cory: a cheaper phone. you know, i like john chen a lot personally, and it seems like they have got a better direction. going cheap and going broad. crawford: again, i would argue that his first sentence is the one i agree with the most which is transitioning into a software and services company. when you look at the devices they are trying to go low end, trying to attract new users, but i think you give the people what they want. they have loyal base of customers. and more secure messaging, for example. cory: idc chief research officer crawford del prete. one of the phones introduced was

the zte grand 3. forget thumbprints. the grand 3 can see the whites of your eyes to verify your identity. i spoke about the technology with eyeverify ceo toby rush. toby rush: simply looking at your device we are able to use this selfie camera to look at the whites of your eye, and transform that into a key that logs you in making your life more convenient, more secure yet very private. cory: fascinating. the whites of the eye. i thought most of these devices scan the iris, not the whites of the eye? toby: the eye is a beautiful biometric. it is got a lot of i want resting features. what we are able to do is be software so we can use the selfie camera and see the whites. the other cameras take special hardware and there are no

devices that have that so they all have selfie cameras, so that is great for us. cory: is the selfie camera a term of art? i thought it was a forward facing camera. toby: selfie camera sounds a lot more fun. cory: it certainly does, toby. what are the requirements of that selfie camera? is that part of the evolution that is made this possible would not have been before? toby: sure. cameras have gotten better and better. the word of the year in 2013 was "selfie." so as the phone manufacturer, we love to take pictures. they are putting beautiful cameras on the front facing as well as the back. so they are now 5-mega and 8-mega pixels, which allows us to operate and still be able to see enough resolution. cory: and of course that is 99.9999. these are metrics the kind of metrics that first came out in the power industry where they wanted to have reliability -- too many 9's. what is the bare minimum that you think is necessary of success in terms of the 9's or whatever?

toby: sure. we typically see three levels of accuracy that people want. one is simply 99.9, so you have three 9's. the other is 99.99, so you have four 9's. the other is 0.002%. flip that around, 99.998. so different levels of sensitivity. but generally four 9's are sufficient. cory: toby rush, eyeverify ceo. we will be right back with details with the looming war over mobile maps. ♪

cory: this is the best of "bloomberg west." uber, a startup valued at more than $40 billion, is buying mapping decarta. this is a big deal perhaps signaling an arms race in the world of mapping.

uber said, "a lot of the functionality that makes the uber so reliable is based on map technology. withe the acquisition decarta, we be able to fine tune products and services that rely on apps." uber once relied solely on google map said it will utilize a blend of technologies. but this is the first acquisition they have ever publicly disclosed. it is made other smaller purchases. i talked to the managing director of prioleau advisers. he says this is a big deal. marc prioleau: i think what is really happened is google map are ten years old. as they came out, they developed a great property and everyone

went to them by default. but i think as the business needs, especially big companies that want to dominate their space, what they are finding is that relying on the google map interface and property -- which is essentially designed as a consumer interface -- doesn't meet their needs as enterprises. so this may be the start of a trend you are going to see. cory: regarding those trends. talk to me about -- 10 years ago, the dominant forces in the world of mapping, there were companies like garmin and tomtom, there were mapping companies like magellan and a few others. it is interesting that these are happening away from what was the cutting edge 10 years ago. marc: yeah, and i think there are a couple things that go into

that. one is the map themselves. the digital maps have become easier to collect. and you have things like open street map that are starting to drive that. and technologies like you saw in waze, where you have mobile devices starting to collect map data. so that has changed. the other thing about map technology is that some of the technologies that are sort of under the covers there are not very sexy, not very glamorous, hard to build, and very hard to differentiate yourself positively on. for instance, routing -- you can have a routing thing that sends you the right way 99 times, but you will remember the one time it didn't until you die. so it is very hard to differentiate the positive but very hard to build. i think when you see things like uber going out and buying decarta, it is a great degree of buying proven technology and getting to the market much sooner and having a technology that they can customize for their needs. that is the key thing more than cost, more than money that is really going to drive it at this level. cory: it is interesting that these two companies, google and uber, which were business partners in the early days and

in later days investors where google made a big investment in uber -- really seem like they are setting up to be direct competitors. marc: they may be. and you hear a lot about that. i think on the mapping side when uber started, they started using google maps. it is a great property. it works well. but they have gone along with what they see. some of their real differentiation was how precisely they tune their algorithms to dispatch drivers to find customers, to do things like uber pool. what they found is they could not do that on essentially a consumer-focused app like google maps. so it appears what they are going to do is take that inside and put big effort and develop competitive advantage. it was pointed out to me on twitter this morning -- ups has 40 people working on routing algorithms. so for people this is big stuff. this is where you are different from anyone else. i think that is the move. now, that is what uber wants. but i think you can extend that to big players in the mobile and internet space who look around and say we want to do search different. we want a different look. we want something different that is really tuned to our business model. and that is where you will see those companies starting to make

investments in geospatial and mapping technologies. cory: there also seems to be a trend. to paraphrase public enemy -- is this fear of a google planet? all of these companies thinking, "i don't want to build my business where i am dependent on google, and i wake up one day and watch "bloomberg west" and see they are competing with me." marc: right, and i think that one part is that. and certainly google has been pretty aggressive getting into from the travel business and you are using google maps, you scratch your head when google launches travel-related products. but i also think the other part that is really important is google has done such a great job on maps because they were the first ones to understand that maps were not just pushing data to the user, it is also about collecting data, about where the user is, how they are going, what traffic conditions are. and that data becomes key to tuning whether it is your search or routing algorithms. and google gets that data. but if you are using googlemaps,

you might not. so that is one of the things uber will benefit from is capture that data. cory: right. this notion that the user is providing data to the company, that google is tracking where you are going -- is what you are saying -- uber wants to track where i am going, and twitter wants to track where i am tweeting, and apple wants to know where i am shopping, on some levels to understand that user data and control over that data is really what this is about? marc: i think that is a key part of it. and again it may not be that they particularly want to know

where you are going or i am going. my life is less interesting than that. but in aggregate super important stuff where people are where they are moving. and one of the big industries you see growing is understanding of this user context and one of the key signals there is location. so that ability to access that user location is a huge asset, and i think more companies are going to want to own that themselves. cory: that was marc prioleau the managing director of prioleau advisors. we will be right back talking about two of the hottest startups -- snapchat and stripe -- right after this. ♪

cory: you are watching the best of "bloomberg west," where we focus on innovation, technology, and the future of business. i am cory johnson. here is a look at the stories that made headlines in technology this week. apple delaying production of their larger screened ipad. production of the big ipad is now scheduled to start in september. apple has been dealing with delays involved with the supply of display panels. ipad sales have been falling for four straight quarters. research team led by microsoft cofounder paul allen has found the wreckage of a massive japanese world war ii battle ship. the ship is called the -- it is considered one of the most technologically advanced ships in that war sunk off the coast of the philippines by u.s. forces in october 1944 in the

run-up to the battle of the lechi gulf. they have been searching for this ship for eight years. and there are a lot of ways to pay. i can swipe with square, click with stripe, wave with apple pay. how many of these options do consumers need? what this all means is the managing director of catalyst, hemant taneja, an investor in both stripe and snapchat. here is my interview with him. hemant taneja: think about how payments used to be. it was much more complex process before stripe really arrived. today any developer that opens up a website and decides to sell, payments is merely an api call so they be embed payments. cory: so it used to be when someone would start a website, drugstore.com, a great, big company.

you would have to build an infrastructure to figure out how am i going to recognize the numbers that are going to come in? how am i going to verify those numbers? how am i going to suck the payment out of that account? how can i tell the consumer that the payment has been accepted? hamant: that is right. and wait for weeks of approval to get in business. today you create your website and within minutes you are able to accept payments. stripe does all of that for you. all that you talked about, it makes it a core utility. cory: the interweb, which is a series of tubes, is at least 15 years old where you have had e-commerce websites. let's call it 20. amazon is about 20 years old now. is it really the entire time there hasn't been an a.p.i. for that? hemant: absolutely not. it completely -- in today's world it looks like a broken stack.

visa and mastercard serve a function. when you think about the interchange -- cory: a broken stack, which is to say lots of crummy technology that does not fit well together stacked on top of each other. hemant: absolutely. they are handling risk, they are handling fraud. today with everybody online and on social media, you know so much about them that you have to rethink the payment stack from the ground up. how do you think about fraud the identity of the users? and therefore, a new contemporary stack that emerges and automates a lot of that for you. that is really what stripe does. cory: in other words, in an era in which people are sharing all the names of their kids on facebook, and they are tweeting out their both their thoughts and location and maybe when their birthday is on a regular basis, that suddenly the old rules, rather than adapting, need to be completely thrown out we have to have a new technology? hemant: absolutely.

when you think about the purchasing experience today, what a lot of your social media types are doing, a lot of what e-commerce is about -- in the early days you go to the store pick what you want to buy, then you click on a page that takes you to a payments page. today you want to be able to see a product, catches your eye in a twitter stream or your facebook stream that your friend is recommending, and you want to buy right there. that is what this is doing. it is the idea of payment is getting embedded in the concept of the product itself anywhere on the web. cory: so valuation wise, i would not understand why stripe would seem like the kind of company adjacent to a lot of money where they can get the money as part of those transactions on a massive scale, but not talking just about valuations but about oversharing. you are invested in snapchat, a fascinating company, basically free revenue, which has achieved -- what round did you invest? pretty early. hemant: pretty early. cory: and this is now becoming

an enormously successful service. it is also free. it has achieved an incredible valuation, not unlike stripe and some other companies. to what do you attribute that valuation? hemant: i think it is really hard to create a large communities of people around communication. when you think when you think about what facebook did, what whatsapp did where there is hundreds of millions of people using that product on a monthly basis, that is a really rare occurrence. and what snapchat has been able to do is create a new communication paradigm, added on stories, now added on discover and all these products. it is a new way to communicate that users want to use in their tool chest.

cory: is there a business model? you sell $1 for $0.50 -- there is not a business. hemant: there will be a business model for sure. you have to be cognizant of the fact that this is a 3-year-old company. it has gone from zero to a couple hundred people. but the growth is so stunning that it is not hard to understand that when you are doing this the kind of things that evan is experimenting with as you will be able to scale revenue exceptionally fast, and that is why valuations are justified. cory: that was general catalyst managing director hemant taneja. the best of "bloomberg west" will be right back. we will be talking about space and a mysterious explosion of a secret satellite. we will talk about that when we come back. ♪

cory: i am cory johnson. this is the best of "bloomberg west." space is full of mysteries including this one. an aging defense satellite mysteriously exploded in orbit last month. what happened? power failure? space junk? investigators aren't telling us. i spoke about it with geographer and author of "blank spots on the map" and cinematographer trevor paglen.

trevor paglen: the national reconnaissance office is like the secret version of nasa. so the u.s. actually has two space programs. there is the public one nasa the space shuttle apollo, all that kind of stuff. another space agency that builds secret satellites. they build classified reconnaissance satellites for themselves and serve the dia cia, national geospatial intelligence and the nsa. cory: so the satellite that blew up a few weeks ago, space debris heading towards the earth. nerds with telescopes saw it. the government did not tell us about it. trevor: what happened in early february, an air force satellite defense meteorological satellite

program flight number 13 launched in 1995, and in early february something happened to it and it looks like it exploded. and this was seen by an amateur astronomer in the u.k. basically with a pair of binoculars, saying i think this thing blew up. about 20 days later, i think the air force finally fessed up and confirmed that this thing had indeed exploded. not really sure why. nobody is really saying -- if anybody knows at all. but it is actually not the first time that one of these dmsp spacecraft had blown up. there was another one, an earlier one that something similar happened to in 2004. cory: the existence of this secret program was a secret for

a long time and then it was not. trevor: yeah. the n.r.o. was begun in 1960 when we first started building satellites and wanted to do it in secret. it was a compromise between the air force and cia, who were fighting over who would control secret intelligence assets in the space. so the nro was formed and existed for 30 years as a black agency. in other words, the existence of the agency itself was a secret.

and that was true until 1992. if you were in the air force in the 1980's and worked on spy satellites you said the words "national reconnaissance office" in public, you would be breaking the law. to this day most everything that they do is secret, but the fact of the existence of the agency is no longer a secret. cory: and the speculation is the technology is much more advanced than nasa, but the size of the program is interesting. here is a quote from one of the generals who ran the organization up until recently. specifically what he talked about is sort of the size of this agency. he said, "they are undertaking probably the most aggressive launch scheduled that this organization has taken in the last 25 years." and he went on to say "and there are a number of satellites that will go into orbit in the next year." in the year-and-a-half, i should say. so these guys are not only

launching satellites, but they are launching at a much more aggressive space. trevor: absolutely. historically it is had the largest budget of all the intelligence agencies. that is no longer true. the cia's budget has eclipsed them because it is very expensive to put things in space. but it seems there are a number of new programs that have been going up in the last few years the nro are trying to put up looking forward there is a new generation of synthetic imaging satellites called topaz. that was the octopus patch that you put up. they are trying to build a new generation of photo imaging satellites. and of course they are also building and expanding the signals intelligence satellites that the n.s.a. uses to vacuum up electronic signals. cory: so what you are doing on your phone, is that the thing they are sucking up? trevor: to a certain extent. the nsa does a lot of its sensor collection over fiber optic cables. so that is really where the bulk of the internet is in fiber optic cables moving across the continent and under the seas. but they have dedicated spacecraft for doing signals intelligence satellites. and what they will do that for is phones in the middle east for example would be a big thing

that they would want to collect the signal. also military communications. so the nsa doesn't just spy on normal people. they do that as well, but obviously there are other foreign governments, military is a big target. cory: a lot of private industries probably benefit from this spending, the billions of dollars going to the programs. oscar-winning cinematographer and geographer trevor paglen. we will be right back talking about sony's push into virtual reality, next. ♪

cory: this is the best of "bloomberg west." i am cory johnson. the game developers conference was in town this past week. it is a big deal and the big topic was virtual reality. sony is showing everyone they are the vr player. they just revealed the prototype of its morpheus for the ps4. they said they want to release this in the first half of 2016. i spoke with the guy who runs this unit for sony, dr. richard marks. dr. richard marks: we have a new headset. it has got new specifications much better than the old one. we also announced the release in the first half of next year. cory: how is it better than the older? dr. marks: it goes up to 120

frames per second, which is double than we had before. it has a new panel instead of lcd. cory: renders faster? dr. marks: just much nicer on your eyes actually. a little wider field of view. ergonomics are better. so a lot of improvements in different areas. cory: what are you finding? tell me about your expertise and why your degree in rocket science has you working in virtual reality. dr. marks: well, aeroastro engineering is basically systems engineering, and games are all about complex systems. there is hardware and software components. so it translates pretty well even though it doesn't seem like it might. cory: what are the principle challenges? jeremy at stanford university has written a lot about virtual reality. he thinks that games are not the best use of the technology. that you just get exhausted by the bombardment of the 3d

experiment that virtual reality provides. obviously you think differently. dr. marks: when you are in virtual reality, it feels like you are somewhere else. the more realistic the place is, the less you are overwhelmed because it feels like you are just some place. cory: you are chasing zombies through an abandoned mine. it is not real. so you are saying that experience is not exhausting but that the real experience of that would be exhausting. dr. marks: you can make it as exhausting as you choose. you could have an experience which is completely exhausting but you can kind of ramp that back. and we are seeing in virtual reality especially perhaps more traditional games -- it is not just about running through as fast as you can get through. it is more about enjoying the space where you are. so a lot of the ambiance is really important, more in virtual reality than in a traditional game. cory: the trippiest thing -- i have a little bit of experience with oculus -- is just sitting in a yurt and noticing that someone was behind me making soup as i turned my head, and then they went away when i turned my head back.

does that mean a totally different kind of game play that maybe first-person shooters, for example, will not be the same success that they will be in virtual reality? dr. marks: definitely there will be different game play for virtual reality games. some of the genres translate over. for example, driving games work pretty well, but others don't translate directly over. some of the world's people have already made come over, but maybe the game play will be a little different. cory: what does sony have over facebook and oculus? dr. marks: we have like 22.2 million playstation 4's already out there. so we have an installed base of our hardware platform, and we can kind of control our own ecosystem. the morpheus is made for playstation 4, and we have known people interested in this kind of stuff, and we can deliver software to them, new

experiences to them. so we kind of control our own destiny. we have known controllers. the dualshock 4 and playstation move. and every single one of these units is the same. so when a game developers makes a game he knows exactly how -- the experience. because you don't worry about drivers or anything like that. for a person buying it they know they can buy it plug it in and it will work. they don't have to worry about the complexity. cory: is the technology so unique that it can't be replicated? samsung tried to get some attention and continues to try to get attention with their oculus glasses made by samsung. you are going your own way completely. are there really essential patents or differences in the two kinds of technologies? dr. marks: there is a lot of commonality between some of the systems. sony has a lot of experience in a lot of the areas that makes sense for virtual reality. the display, audio, optics, and all these things, and consumer devices in general. we are good at all those things, so we are a natural fit.

other companies have elements of that as well. and the devices unfortunately, you know, on the pc side especially the devices range from maybe a piece of cardboard all the way up to a very high end system. whereas on the console, it is kind of more -- there is one choice for the ps4. so there is no very not as much variability. cory: that was dr. richard marks with sony. we will be right back, and we will get an update on the growing tech scene in the sunshine state, speaking with the mayor of orlando. ♪

cory: i am cory johnson. this is the best of "bloomberg west."

could the home of disney world universal studios be the next big hub for technology? yes, orlando. the florida tech scene is growing fast there thanks to investments from google, apple and electronic arts. the city itself has given thousands of dollars to orlando's incubators. i spoke with orlando's mayor buddy dyer. i asked him about the influence of e.a., which built the madden game in orlando for years. mayor buddy dyer: there is so many alumni that have started their own companies and been part of the fabric of the tech community in downtown orlando. and interestingly enough about eight years ago, ea came to us and said, "hey, we want to expand here, but the talent pool is not deep enough." so we got together the city and ucf, the university of central florida, and created the florida interactive entertainment academy in one of our buildings, and it is a graduate program for video gamers. and it has been very successful. it is now the second leading program of its type in the country. cory: fairly interesting. when you look across the country -- because there is a silicon valley of colorado, and there is a silicon valley of the desert and there is a silicon valley of the middle east.

you name it, everybody is trying to do a silicon valley. what is it that is so attractive to you in terms of economic development about technology? mayor dyer: well, they are high-paying jobs in general. and it is -- we always want to look at the supplying our economy -- the recession really emphasized that to us. two of our leading industries are tourism and home building, and they were deeply affected during the recession. we have a great life sciences cluster, and we did not lose a single job in that industry during the recession. cory: how do you figure out -- city budgets are rough. you have got quite limited resources. how do you figure out where to put $100,000 grant here or $50,000 grant here, which are

drops in the bucket of any kind of technology budget? mayor dyer: well, generally when attracting a company from somewhere else or growing jobs we have a tax credit that gives a little bump for every job that is created above the median in orlando. and that is really a state program. and then we have some other programs that emphasize targeted industries in our downtown. cory: when you are attracting these workers, do you feel like you are pulling them from other places? i have talked to executives at ea, and while they might have trouble finding the people they want in orlando, they like what they can pay them in places like orlando. it is not as expensive as in silicon valley. do you feel like that is a great advantage? mayor dyer: i think it is an advantage. what we are getting a lot of

these people from our area who have moved to california and texas and moving back and returning with the experience they have gained in the other communities. cory: are there unique city planning? i have lifelong interest in city planning probably because of disney world growing up. i am wondering if that is different around a technology-based community, are they different than they would be around other industries such as home building and so on? mayor dyer: we actually have a great opportunity in our downtown. we recently built a new arena, a new performing arts center and renovated our citrus bowl, and that freed up about 70 acres. and we are in the midst of planning and developing something we call the creative village. so it has that florida interactive entertainment academy as a base. we are going to construct at ucf a joint-use facility there that will house between 10,000 and 15,000 students and on the surrounding acres we want to develop a work live and play space. cory: that was orlando mayor buddy dyer. that does it for this edition of the best of "bloomberg west." catch our regular show weekdays

10:00 and 3:00 on the west, 1:00 and 6:00 on the east coast. we will see you later. ♪ . .